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Role of HR in Employee Retention & Productivity

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  • 0:04 Role of HR in Employee…
  • 1:11 Why Employees Leave
  • 2:16 Employee Retention Strategies
  • 4:11 Lesson Summary
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Lesson Transcript
Instructor: Noel Ransom

Noel has taught college Accounting and a host of other related topics and has a dual Master's Degree in Accounting/Finance. She is currently working on her Doctoral Degree.

This lesson reviews and explains how human resource managers and teams can implement methods to increase employee retention and how employee retention strategies can lead to increases in employee productivity.

Role of HR in Employee Productivity

Meet Adam, a human resource manager at a small firm. Adam is having a tough year because several employees have left his company to pursue other job opportunities. As an HR manager, Adam is in charge of attracting, hiring, and retaining employees within the company. Adam knows when his boss gets the updated report on employee retention, he is not going to be very happy. Employee retention is the ability of an organization to keep employees.

Adam notices that over the past six months, his employee retention rate has decreased drastically. The employee retention rate is a measurement that helps HR managers determine how many employees the organization can keep over a period of time, and it's expressed as a percentage. In fact, the employee retention rate that Adam will report to his manager is 30%. This means that the company kept only 30% of its employees over a particular period. Adam must make some changes to increase his employee retention rate, so he begins to research specific strategies to keep more employees working for the company longer.

Why Employees Leave

Before Adam comes up with an action plan to increase employee retention, he needs to find out why employees are leaving the company. After some extensive research, Adam discovers there can be many reasons employees leave an organization, including:

  • The job requirements don't match the employee's skills and qualifications.
  • The job isn't what the employee expected.
  • There aren't enough opportunities for promotions or advancements.
  • Employees feel they're not valued by managers and other leaders.
  • Employees feel overworked, and the workplace environment is stressful.

Wow! Adam is shocked by all of the reasons that employees might leave a company. He sure has his work cut out for him, because he must figure out which of these are the top reasons people are leaving his company. After a brief survey, Adam discovers the main three reasons his employees are leaving: There aren't enough opportunities for growth, employees don't feel valued, and they're overworked and experiencing stress related to job functions and activities.

Employee Retention Strategies

Adam knows what to do now, and he comes up with a few employee retention strategies he believes will help keep his employees working for the company. Through this process, he must reduce the turnover rate. The turnover rate is a measurement that indicates the number of employees who leave a company and are replaced by other employees. It's important for Adam to understand the turnover rate because this measurement helps him keep track, not only of the reasons why employees are leaving, but also how quickly they leave the company and need to be replaced.

Adam creates a new training program for all newly hired employees. He wants to make sure that they're not only aware of all the tools they have available to them to perform their jobs, but that each employee knows how to use these tools and understands their individual role. Adam also creates a mentoring program that involves partnering a new employee with a senior leader to job shadow the leader and increase awareness of how leaders work within the organization to make decisions.

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